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Tuesday, October 4, 2011

Those of you who lived throught he great bear market of 2008 will remember this crap: break a key technical level, and then watch as the market sharply reverses in the last hour based on yet another rumored bail out. This was nearly a daily occurence in January 2008, and it is becoming routine now. I meant to put up the new pivot points on yesterday's chart and forgot, so today i put them up with no annotations/ This morning we broke S1 decisively, leading wither to a huge drop or a huge rally. We did get a rally, which crapped out about midday. leading us right back down when the rumor hit. Volume was huge today, so this could be a key reversal day, and until proven otherwis i will treat it as such, meaning I will again start looking for buys, then start pulling the trigger if we get a follow through day. Yeah, it sucks to have the market manipulated like this, but it is happening so often it is now normal, so I guess I better get used to it.

Stockcharts still hasn't updated the WTIC chart, so I had to go back to USO. Notice we nearly tested S1 before the big reversal. S1 should provide pretty strong support here, and the middle pivot is going to be resistance. From here, that is a decent trade.

Gold has been in a small bounce after it's recent big move down, but that ended today. This also almost tested a pivot point, in this case resistance, and now has the 200dema as first support. It will probably test it, If the latest bailout rumor turns out to be true, this will probably drop like a rock, at least for a while, with S1 a long way down from here.

The yield on the 10 year treasury appears to be in the midst of a trend change. The RSI and MACD are both moving up, diverging from price, which has just finished establishing a higher low. It may take a while, but this appears ready to start grinding it's way up.

The USD index chart also has not been updated yet, so I had to go to UUP. It is interesting that this was at R1 when it reversed. It seems that whoever it is in charge of rumors knows how to read charts. I will bet they caugh a ton of shorts off guard.

I am a little frustrated with this crap, but i should not be. It has been the status quo for a few years now, and only serves to prolong the bear market (and probably will lead to a crash). It i clear to me that all the stops will be pulled out, and nothing will be spared in TPTB's efforts to save the banks. Ultimately, I believe they will fail.

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About Me

I am not a financial professional, just a guy that trades my own account.
I am also not a musical professional, just a guy that makes music on the computer. Thus, two blogs, one trading and on musical.
And, no, the picture is not me, it is the late, great John Belushi, one of the inspirations for these blogs.

About ThIs Blog

This blog is focused on technical analysis of stocks and markets, putting heavy emphasis on chart analysis. My trading style is derived primarily from my mentor, William "Yoda" O'Neil, and the focus here is on leading and breakout stocks, but all forms of trading are covered to some extent. Economic and political news that effects the market are also topics here, and the blog may occasionally become a platform for my political and philosophical ranting. I keep several spreadsheets on Google docs which track various aspects of the market and readers are welcome to vies and comment on them.

Google Docs Spreadsheets

There are several spreadsheet that I maintain on Google docs to track various watchlists and trends in the market.

1. The earnings list - a group of small and micro cap, low float stocks that have exhibited recent rapid earnings growth. They are modeled along the lines of William O'Neil's CAN SLIM system, but limited to small cap, highly volatile stocks.

2. The relative strength list - a group of stocks which are near 52 week highs and have shown an increase in average daily volume. The list is limited to the top 200 stocks according to my methodology, which will be detailed on one of the pages of the spreadsheet.